Gunns swipe
GUNNS Ltd has criticised the state government as debate over money for the timber company threatens a $276 million deal to end the state's forestry wars.
Gunns managing director Greg L'Estrange last night expressed frustration with delays over payment for its logging contracts after Premier Lara Giddings said yesterday that decision was still weeks away.
She also said that $23 million was the most Gunns could expect.
Mr L'Estrange said that the company felt misled after it had agreed to receive fair compensation under a forestry peace talks process that began after it announced early last year
it was quitting native forests.
"We chose to stick with an open, collaborative process and now it appears that we are being punished for that,'' he said.
The criticism was posted in a release to the Australian Securities Exchange in response to the government appointing Wise Lord and Ferguson as an independent probity auditor to oversee a settlement between the government and Gunns.
Trading in Gunns shares has been halted since August 4.
Ms Giddings said she understood Tasmanians did not want to see money handed to Gunns due to its behaviour, but legal advice had indicated that was unavoidable if the
government's agreement with the Commonwealth was upheld.
She said appointing a probity auditor would give the public confidence in any final agreement.
Payment would be capped at $23 million in federal money from the intergovernmental agreement.
The stoush came less than a week after Mr L'Estrange disputed claims by government business enterprise Forestry Tasmania that it was owed $25 million from Gunns due to
terminated contracts.
Mr L'Estrange said the company felt misled by the government after entering into a process in good faith that was now dragging on.
"When the intergovernmental agreement was announced, Ms Giddings said it would take seven days to resolve the financial outcomes. It has now taken two weeks to reach what
is still essentially a non-decision,'' he said.
He also emphasised that the company's decision to exit native forests was directly linked to finishing its Bell Bay pulp mill project.
A company spokesman said last night major works were yet to start on the $2.3 billion project, as is required under state permits with an August 31 deadline.
The Premier's statement on payment to Gunns conflicts with a clause of the intergovernmental agreement that states: "no Commonwealth funds will be paid to progress the Bell
Bay pulp mill project''.
Federal Environment Minister Tony Burke said the money was provided to Tasmania to carry out its responsibilities.
"How Tasmania goes on to use that funding is a matter for Tasmania,'' he said.
Deputy Opposition Leader Jeremy Rockliff called on Ms Giddings to release the advice.
Greens forestry spokesman Kim Booth said he was happy that the party's call for a transparent and accountable process had been heeded.
"But it's important to distinguish that this is not compensation,'' Mr Booth said.
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